2nd GLOBAL PROCUREMEREMENT CONFERENCE Tor Vergata University Rome Debarment in Public Procurement MDB perspective Jan Jackholt Procurement Director European Bank for Reconstruction and Development

European Bank for Reconstruction and Development International financial institution, established in 1991, promotes transition to market economies in 34 countries from Central Europe to Central Asia In 2011, the Bank expanded its operations to include Egypt, Morocco, Tunisia and Jordan (SEMED Region - Southern and Eastern Mediterranean) Owned by 65 countries and two inter-governmental institutions Capital base of €30 billion AAA credit rating by Standard & Poor's, Fitch and Moody's

European Bank for Reconstruction and Development

European Union: from 1 (Denmark) to 75 (Bulgaria) EBRD countries of operations: from 23 (Estonia) to 156 (Uzbekistan) *out of 176 countries

EBRD PROCUREMENT POLICIES & RULES Key principles: (Articles establishing the Bank) economy efficiency non-discrimination transparency and accountability

MDB’s and Fraud and Corruption history In the 1980s and early 1990s, the MDBs, by-and-large, adopted a passive approach, considering corruption to be a matter for national enforcement authorities to investigate and prosecute The World Bank Guidelines included in 1996 for the first time a paragraph on Fraud and Corruption EBRD amended the PP&R in 1995 to include UN Chapter VII and in 1997 to include Fraud and Corruption

MDBs and Fraud and Corruption Constraints: The Bank is not a party to the contract financed Audit of contractors account by the Bank can only happen if the contract allows for it. MDBs makes procurement decisions based on information provided by the client and the client on information provided by the tenderer. The Bank’s role is to provide financing. The range of “punishment” for misprocurement is limited. Many allegations, but difficult to prove.

EBRD and Fraud and Corruption Prevention and detection: Project planning The use of Standard Tender Documents Prior review of all key stages Implementation support Restrict direct contracting Restrict negotiations Restrict subjective evaluation criteria Open eligibility, no restrictions to participate Third party review of qualification criteria and specifications Independent reviews during and after contract implementation EBRD Procurement complaints mechanism.

Some thoughts No procurement process is immune to fraud and corruption. Transparency also have drawbacks but the benefits outweigh. Third party monitoring more efficient than perfect procedures in writing. E-procurement is excellent in preventing process mistakes but not to stop F&C. Procurement is more often tainted by the purchasers need to satisfy the political context or by poor practicies than F&C Is it fraud or a mistake?

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